Rates are crashing and fuel to the moon!

Discussion in 'Ask An Owner Operator' started by Kenworth6969, Mar 3, 2022.

  1. ProfessionalNoticer

    ProfessionalNoticer Road Train Member

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    100 percent required by law for certain sized loads. Sometimes two of them are mandated. Isn't that awesome? The state forces people to pay for your services! That's my kind of customers.
     
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  3. TallJoe

    TallJoe Road Train Member

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    I take that it means that you could your job without their aid?
     
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  4. ProfessionalNoticer

    ProfessionalNoticer Road Train Member

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    I don't do permit loads. Too much hassle and the rates aren't that great unless you get into more specialized work which I definitely don't want any part of either.
     
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  5. 77fib77

    77fib77 Road Train Member

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  6. 77fib77

    77fib77 Road Train Member

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    Yes fed hikes affect interest rates. Fed raising rate raises the amount of interest banks have to pay to borrow from the fed.

    What I don't get is how can you give a loan out with interest less than inflation rate? I mean they can, that's how, but it's counter intuitive to me. I believe the bond market has something to do with rates too.

    You could YouTube it and sift thru the various opinions.
     
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  7. snowwy

    snowwy Road Train Member

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    Do Google research on fed rates. It's not exactly what you think it is.
    It's the overnight lending rate between banks is what I keep hearing on business news for the last 25 years. What the bank charges the consumer is a little different. BUT. The fed rate does have a part in it.

    Think. Different banks having different credit card rates. Then. You have your credit score also a factor.

    Mortgage rates started going up last year with the 2 year T note. Long before the fed rate. I don't know why the two play together but apparently they do. That was also on business news last year.

    Trump wanted zero interest and look what happens. People buy everything they can on the lower interest. Demand outpacing supply. Who wouldn't want to finance on the lowest rates we'll ever see in our life. Throw in covid and supply chain issues and everything else that goes with the manufacturing and delivering of goods.

    The perfect storm for inflation. That started with Chinese Tariffs 5 years ago.

    As for trucks. I don't know if prices are coming down yet but I'm starting to see some inventory on the dealer lots.
     
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  8. Accidental Trucker

    Accidental Trucker Road Train Member

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    Yes, the Fed rate influences everything, but only indirectly. Yes, your truck loan rate will go up because the cost of funds of the banks go up. They lend money their depositors given them. Now they have to offer higher interest rates to attract depositors, so they have to charge higher rates to borrowers.

    interestingly, many consumer debt instruments like credit cards and HELOCs are linked to the LIBOR (London Inter Bank Offered Rate) rather than the US Prime Rate.
     
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  9. No_worries

    No_worries Bobtail Member

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    As of the first of this year, LIBOR is no longer used and has been replaced by the Secured Overnight Financing Rate for indexing most consumer and commercial credit. For all intents and purposes, this mostly follows the direction of Fed Funds. You've probably been getting notices from your bank lately notifying you that your savings rate is increasing. Rising Fed rates affect credit card, auto, personal, and yes, truck loans. Mortgages are more closely tied to the 10-year treasury; its price reflects growth and inflation expectations 10 years from now. It often moves with the Fed, but not BECAUSE of the Fed.

    Truck prices are a function of supply/demand and cost to build. Recently (the past year plus), there has been near zero supply because of component shortages, so prices skyrocketed. As freight has dried up in the last six months, demand for trucks has softened but still oupaces supply. Prices have moderated some, but are still at extreme levels. The supply chain problem for components is improving but is not fixed. A fully functioning supply chain and continued slowing economy will ultimately bring truck prices down, though not to prior levels.
     
  10. D.Tibbitt

    D.Tibbitt Road Train Member

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    Anybody that takes that load for that rates gets what they have coming to them
     
  11. Phoenix Heavy Haul

    Phoenix Heavy Haul Medium Load Member

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    Depends on route and dimensions. Once you get over 13’ wide they are really helpful to have.
    Front escort will check for upcoming issues ie: cars broke down on the side of the road, Incoming traffic from on ramp, low bridge heights etc.
    Rear escort will run block for you and will let you know when traffic is coming up to pass.
    Very helpful to have them their worth the couple bucks a mile to have.
     
    Last edited: Jun 30, 2022
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